ZI WACC - Weighted Average Cost of Capital
The WACC of ZoomInfo Technologies Inc (ZI) is 6.7%.
| Range | Selected | |
| Cost of equity | 6.3% - 8.8% | 7.55% |
| Tax rate | 11.7% - 35.9% | 23.8% |
| Cost of debt | 4.0% - 7.5% | 5.75% |
| WACC | 5.5% - 7.8% | 6.7% |
| Category | Low | High |
| Long-term bond rate | 3.9% | 4.4% |
| Equity market risk premium | 4.6% | 5.6% |
| Adjusted beta | 0.52 | 0.7 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 6.3% | 8.8% |
| Tax rate | 11.7% | 35.9% |
| Debt/Equity ratio | 0.35 | 0.35 |
| Cost of debt | 4.0% | 7.5% |
| After-tax WACC | 5.5% | 7.8% |
| Selected WACC | 6.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| ZI | ZoomInfo Technologies Inc | 0.35 | 1.66 | 1.28 |
| AUTO | Autoweb Inc | 1.85 | 2.07 | 0.8 |
| BMBL | Bumble Inc | 1.04 | 0.67 | 0.36 |
| EQ.V | EQ Inc | 0.02 | -0.05 | -0.05 |
| GSMG | Glory Star New Media Group Holdings Ltd | 0.11 | 0.46 | 0.42 |
| PROM | Propel Media Inc | 0.28 | -1.54 | -1.24 |
| TPNI | Pulse Network Inc | 3420.46 | 1.28 | 0 |
| WB | Weibo Corp | 0.25 | 1.02 | 0.84 |
| Y.TO | Yellow Pages Ltd | 0.26 | 0.53 | 0.44 |
| Low | High | |
| Unlevered beta | 0.37 | 0.43 |
| Relevered beta | 0.28 | 0.55 |
| Adjusted relevered beta | 0.52 | 0.7 |
ZI's CAPM model and how its cost of Equity is calculated
The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.
This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.
Here’s how we figure out the cost of equity for ZI:
cost_of_equity (7.55%) = risk_free_rate (4.15%) + equity_risk_premium (5.10%) * adjusted_beta (0.52) + risk_adjustments (0.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.